Compared to 2017, 2021 has witnessed a more diversified trend in cryptocurrencies, which is reflected in the emergence of a large number of new tokens and digital asset projects, enriching the digital asset ecosystem. Not only has it attracted some celebrities to enter the cryptocurrency market, but it has also prompted capital to be more decentralized in the cryptocurrency market, which is conducive to the further development of the cryptocurrency industry. Including:
New blockchain platforms: In addition to Bitcoin and Ethereum, 2021 saw the rise of some new blockchain platforms that provide infrastructure for different tokens and applications, such as Solana, AVAX, etc.
DeFi tokens: DeFi is a hot trend in 2021, attracting a lot of funds and projects. DeFi tokens provide users with a variety of financial services, including lending, staking, and liquidity mining, such as Uniswap, AAVE, etc.
NFT Tokens: NFTs have experienced explosive growth in 2021, attracting artists, media companies, and collectors. NFT tokens represent unique digital assets, such as Sandbox.
Social Tokens: Some new social tokens have emerged in 2021, which are associated with social media and content creators. These tokens can be used to reward and support fans of creators, as well as promote social interactions, such as SOC, BAT, etc.
Chain game tokens: The gaming ecosystem on the blockchain is also growing in 2021. Some game tokens, led by AXS, have become popular digital assets used for transactions within the virtual world and in-game incentives.
Factors driving the subsequent bull market
Interest rate cuts: Currently, the US inflation rate is still hovering around 3%. The Fed's official hard requirement for inflation is 2%, and Powell and other Fed officials have repeatedly stated that it is unlikely to change the inflation target. Therefore, the timing of the interest rate cut depends largely on when the US inflation rate can return to the 2% level. But even if the interest rate is cut, it is likely to complete the entire interest rate cut cycle in 2-3 years. During the interest rate cut cycle, the currency price may rise in a step-by-step manner. According to current data, it is expected that interest rates will start to be cut in the fall and winter of 2024.
The cryptocurrency regulatory system is more mature: In the first half of 2023, the United States, Europe, Hong Kong, Singapore, Japan and South Korea began to establish regional cryptocurrency regulatory policies. With stricter supervision, more mature laws and more transparent transactions, cryptocurrencies may gradually get rid of their negative labels such as "unsafe" and "money laundering tools", thereby attracting large financial institutions to be more confident in cryptocurrencies and attract more funds to enter the market. It is expected that 2024 will still be a year of rapid development of the regulatory system, and a relatively mature system will be formed in 2025.
Cryptocurrency projects are more diversified: It is expected that in the next bull market, cryptocurrencies will show a more diversified trend, including token diversification, ecosystem diversification, and financial product diversification; among them, token diversification includes emerging AI tokens, tokens launched by large companies (PYUSD), etc., ecosystem diversification includes decentralized e-commerce based on Web3, the emergence of decentralized data storage, etc., and financial product diversification includes ETF funds that are about to be launched.
End of the article
Cryptocurrencies have gone through three spectacular bull-bear cycles, and Bitcoin has also exceeded $1 trillion for the first time in 2021. This will mark the event that cryptocurrencies have become one of the mainstream alternative assets in the world. In the new round of bull-bear cycles, the increase in Bitcoin will also be limited by its huge asset size. From then on, when the crypto asset pie forms a stable pattern and division globally, the probability of an epic bull market will become smaller and smaller.
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